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Industrial Engineering & Manufacturing vocabulary · Inventory and Materials

Reorder point

Meaning in industrial engineering & manufacturing, with examples

nounCommon term

In industrial engineering & manufacturing, reorder point means: The stock level at which a new order must be placed so that the material arrives before you run out. Often shortened to ROP.

In Turkish: yeniden sipariş noktası, sipariş noktası

How it is used

Usually calculated as the average demand during the lead time plus safety stock. ERP systems can create a purchase requisition when stock falls below the reorder point. Planners set, review and adjust reorder points when demand or lead times change.

Example sentences

  1. We use 200 bolts a day, the lead time is 5 days and safety stock is 400, so the reorder point is 1,400.

  2. Stock has fallen below the reorder point, so purchasing has already sent the order.

Common collocations

  • set the reorder point
  • fall below the reorder point
  • reorder level
  • reorder quantity
  • safety stockExtra stock kept on top of normal needs to protect against unexpected demand or supplier delays.
  • lead timeThe total time between the start of a process, such as receiving an order, and its end, such as delivering the product to the customer.
  • economic order quantityThe order size that gives the lowest total cost by balancing the cost of placing orders against the cost of holding stock. Shortened to EOQ.
  • inventoryAll the materials and products a company holds: raw materials, parts, work in progress and finished goods waiting to be sold.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Inventory and Materials

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